S&P 500 Pauses Document Rally, Cling Seng and ASX 200 Edge Larger

S&P 500, HANG SENG, ASX 200 INDEX OUTLOOK:

• Dow Jones, S&P 500 and Nasdaq 100 closed -0.29%, -0.10% and -0.14% respectively
• The IMF upgraded international financial development to six.0% from 5.5% for 2021 as outlook improved
• A slew of Euro Space service PMI information shall be in focus whereas merchants await the FOMC minutes

USD, IMF, California Reopen, FOMC minutes, Asia-Pacific at Open:

Wall Road fairness indices paused their document rally on Tuesday, with Dow Jones and the S&P 500 retreating modestly from all-time highs amid skinny buying and selling quantity. There gave the impression to be lack of contemporary catalysts in a single day to gasoline additional positive factors after Monday’s rally, permitting shares to consolidate. Information crossed the wires that California is able to totally take away the Covid-related restrictions on June 15th. This helped enhance sentiment within the client sector, whereas the data know-how sector was a transparent lagger.

The IMF revised up this yr’s international GDP forecast to six.0% from an earlier estimate of 5.5%, saying that “even with excessive uncertainty concerning the path of the pandemic, a method out of this disaster is more and more seen”. The company has additionally upgraded development forecasts for the US to six.4% this yr, pushed by President Joe Biden’s fiscal stimulus invoice in addition to a fast rollout of Covid vaccines.

The DXY US Greenback index fell for a second day, shifting nearer to check the 20-day SMA line for help. It means that the brief squeeze within the US Greenback has eased and the market continued to unwind expectations about Fed rate of interest hikes forward of tonight’s FOMC minutes launch. Fed Chair Jerome Powell reiterated his dovish rhetoric in just a few public appearances lately, emphasizing that the central financial institution is ‘affected person’ and can proceed to help a restoration with accommodative insurance policies.

DXY US Greenback Index

Chart from TradingView

Asia-Pacific equities are poised to open combined, with futures throughout Japan, Singapore, Malaysia, Thailand and Indonesia pointing to open decrease. These in Australia Hong Kong, South Korea, Taiwan and India are in constructive territory. Australia’s ASX 200 index opened 0.45% larger, led by info know-how (+1.42%), client discretionary (+0.20%) and actual property (+0.18%) sectors, whereas healthcare (-0.33%) and industrials (-0.05%) trailed behind.

Hong Kong’s Cling Seng Index (HSI) resumes buying and selling at the moment after a protracted vacation break. Market members have rather a lot to digest, together with upbeat US nonfarm payrolls print, robust China service PMI readings, vaccine progress and volatility in crude oil costs.

Trying forward, a slew of Markit service PMI readings from the Euro Space headline the financial docket alongside Canadian steadiness of commerce and EIA crude stock information. FOMC minutes for the March assembly shall be launched later tonight, and will probably be intently scrutinized by merchants to evaluate the Fed’s coverage steerage. Discover out extra from theDailyFX calendar.

Trying again to Wednesday’s shut, 6 out of 11 S&P 500 sectors ended larger, with 53.1% of the index’s constituents closing within the inexperienced. utilities (+0.53%), client discretionary (+0.33%) and client staples (+0.33%) had been among the many greatest performers, whereas info know-how (-0.38%) trailed behind.

S&P 500 Sector Efficiency 06-04-2021

Supply: Bloomberg, DailyFX

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S&P 500 Index Technical Evaluation

The S&P 500 indexprolonged larger in the direction of the ceiling of the “Ascending Channel”, which can function a direct resistance stage. The index has damaged a psychological resistance stage at 4,000, opening the door for additional upside potential with an eye fixed on 4,125 (161.8% Fibonacci extension). The general pattern stays bullish-biased as urged by the upward-sloped shifting averages. The MACD indicator is trending larger above the impartial midpoint, suggesting that bulls are nonetheless in management.

S&P 500 Index – Every day Chart

Cling Seng Index Technical Evaluation:

The Cling Seng Index (HSI) broke above the “Descending Channel” as highlighted within the chart under, pointing to a possible bullish pattern reversal. A right away resistance stage could be discovered on the 50-day SMA line (29,300), breaking which can intensify near-term shopping for stress and expose the following resistance stage of 29,500 – the 38.2% Fibonacci extension. The MACD indicator is trending larger beneath the impartial midpoint, suggesting that upward momentum is constructing.

Cling Seng Index – Every day Chart

ASX 200 Index Technical Evaluation:

The ASX 200 index hit a key resistance stage of 6,935 (the 200% Fibonacci extension) and has retraced since. The general pattern stays bullish-biased as urged by the upward-sloped shifting common strains. A profitable try to breach 6,935 might open the door for additional upside potential with an eye fixed on 7,000. A failed try nonetheless, might lead to a deeper pullback in the direction of 6,800 for help. The MACD indicator is trending larger above the impartial midpoint, suggesting that bullish momentum is constructing.

ASX 200 Index – Every day Chart

— Written by Margaret Yang, Strategist for DailyFX.com

To contact Margaret, use the Feedback part under or @margaretyjy on Twitter